FACTA:
The Fair and Accurate Credit Transaction Act (FACT Act) 2003– has mandated
utilities service providers to develop and implement an Identity Theft Program
to identify, mitigate, and prevent identify theft effective November 1, 2008.

The
program will identify “RED flags” which include pattern, practice, or specific
activity that indicates possible existence of identity theft. This will
protect our citizens’ information along with protecting the City of Leesburg.

We
currently use Online Utility Exchange to generate our credit checks. Customers
agree to a personal credit check at the applicant's expense of $5.00. If the
personal credit check demonstrates a credit record satisfactory to the city,
the initial deposit may be waived. However, with the new FACTA regulation, we
are required to implement an identity check on new accounts as well as existing
accounts. The cost of the identity check through Online Utility Exchange is
$5.00 which will be passed on to the applicant for new and transfer accounts
only.

Implementation
of FACTA should reduce collections and write-offs as verification of identity
will enable the City to obtain better information to pursue collections.

Collection Report and Write-Off Recommendations

The
proposal to eliminate reminder notices will save approximately $30,000 and
reduce the collections timeline by approximately 15 days. Customers will be
sent a final notice in lieu of the reminder notice. Ten percent of the
customers receiving reminder notices are actually disconnected for non-pay and
are more often than not repeat offenders. Changing our collections timeline
from 45 days to 30 days will allow for more timely collections, decrease
receivables and associated bad debt, and reduce the time it takes to turn off
an account for non-pay.

Customers
will be eligible to receive an extension if the account is active for six
months with good payment history. Thereafter, the account will qualify for an
extension no more than two times per year with good payment history. In
addition, a supervisor may grant one additional extension.

Ordinance Changes for Deposits

Deposits
for residential customers -– Residential customers will be charged 2 x
average monthly bill or minimum for all services. For deposits greater than
$500.00, the customer may split the remainder of the deposit into two equal
installments.

Change
the process for rental customers - Approximately 60% of our collections are
due to accounts terminating less than a year with 30% of these accounts being
less than six months with the City. By the time we mail out the final
notification, many of our transient customers have already vacated their homes and
leave the City with a balance due. Rental customers will be charged 2.5 x
average monthly bill or minimum for all services. Rental customers will be
provided the option of paying their deposit all at once or in monthly
installments of $25.00 for the amount of deposit that exceeds 2 x the average
monthly bill. In addition, rental customers will be requested to provide the
names of all adults living at the premises when applying for utility
services.

Commercial
Accounts will be re-evaluated per current Ordinance 22-181(c) as a standard
business practice.

Criteria for Refund of Deposits

The
good credit refund of deposits will be eliminated. Deposits will be applied to
the final bill upon termination. If the application of deposit results in a
credit status, the customer will be refunded.

Fee Schedule for Meter Tampering, Meter Testing, and
Re-Read Fees

Meter
tampering – Propose increase for each tamper from $100.00 to $275.00. It is
more advantageous for the customer to pay the current tamper fee of $100.00
than for the actual consumption. By increasing the fee the loss to the City
could be mitigated.

Meter
testing – The City will test electric meters at the customer’s request under
the following conditions: If Leesburg Electric staff determine a significant
anomaly is present in the customer’s consumption records, the City will conduct
the test free of charge. If the test confirms the meter is
inaccurate by more than 2%, the customer’s account will be adjusted
accordingly. If the test shows the meter to be within 2% accuracy, any
future requests to test the meter will require a deposit of $100.00.

If
Leesburg Electric staff does not find a significant anomaly in the customer’s
consumption records, and the customer would still like for their meter to be
tested, a deposit of $100.00 will be required. The deposit will be
forfeited if the test confirms the meter’s accuracy within 2%, and it will be
returned to the customer if the meter is found to be inaccurate by more than
2%.

Re-reads
– Customers currently request re-reads to be done anytime they feel the initial
read is inaccurate. However, this has caused an undue hardship to the metering
department in addition to added expense for gas, vehicle wear and maintenance,
extended time of staff, and overtime to meet each customer’s needs. Staff
recommends allowing one re-read at no charge and charging a fee of $50.00 for
any additional requests. If the re-read shows the initial read to be in error,
the $50.00 fee will be waived. In addition, customer billing generates an
exception report showing any major differences in consumption. Staff will
generate work orders for any significant variances that could indicate a
problem.

Implementation
of these changes should result in an increase in cash and a corresponding
reduction of receivables and bad debt. Verification of identity and the receipt
and retention of social security and drivers license information will provide
our collections partner better resources to find customers that leave the City
with a balance due.

Submission
Date and Time: 4/23/2009 9:02 AM____

Department:
_Finance______________

Prepared by: Lori
Beach/Jerry Boop___

Attachments:
Yes_X__ No ______

Advertised: ____Not Required ______

Dates:
__________________________

Attorney
Review : Yes___ No ____

_________________________________

Revised 6/10/04

Reviewed
by: Dept. Head __JB____

Finance
Dept. __________JB______

Deputy
C.M. ___________________

Submitted by:

City Manager ___________________

Account
No. _________________

Project
No. ___________________

WF No.
______________________

Budget
______________________

Available
_____________________

ORDINANCE NO. ________

AN
ORDINANCE OF THE CITY OF LEESBURG, FLORIDA, AMENDING SECTION 22-181 OF THE CODE
OF ORDINANCES PERTAINING TO UTILITY DEPOSITS; AMENDING SECTION 22-263
PERTAINING TO NONPAYMENT OF UTILITY BILLS; PROVIDING FOR CONFLICTS; PROVIDING A
SAVINGS CLAUSE; AND PROVIDING AN EFFECTIVE DATE.

BE
IT ENACTED BY THE PEOPLE OF THE CITY OF LEESBURG, FLORIDA, that:

SECTION
1.

Section 22-181, of Chapter 22 of the Code of
Ordinances of the City of Leesburg, Florida, is hereby amended in its entirety
to read as follows:

Sec.
22-181. Utility deposit policy.

The
following policy shall govern all deposits made for utilities provided by this
chapter.

(1) Residential
deposits.

a.Amount. The amount of deposit required by
utility is as follows:

Electric . . . $250.00 minimum or two
(2) times the monthly average bill

Gas . . . . . . . $50.00

Water . . . . . . $50.00

If the required deposit is greater than
$500.00, which is due upon initiation of services, customer may split the
remainder of deposit into two (2) monthly installments. The two (2) remaining
installments shall be payable as part of the first two (2) monthly utility
bills rendered to the customer. Failure to timely remit any monthly installment
shall be grounds for termination of the utility service for which the deposit
is required. Customers who have failed to timely pay installments due on a
utility deposit shall not be eligible to elect to pay any future utility
deposits on an installment basis.

b. Application. All
customers must complete a utility application for new or transfer of services,
provide state issued photo identification or driver’s license, and agree to a
personal identity check at the applicant's expense.

c. Refund policy. Deposits will
be applied to account balances upon calculation of final bill. The city retains
the right to apply any refundable deposit against the customer's account(s)
when a balance exists and then to refund any credit balance remaining.

d. Transfer of
Service. When a customer transfers to a new location, utility service
can be provided to both locations simultaneously for seven (7) days without
posting an additional deposit. Deposit and/or final bill will be
transferred to new location.

(2)
Rental accounts.

a. Amount.
The amount of deposit required by utility is as follows:

Electric . . . 2.5 times the monthly
average bill

Gas . . . 2.5 times the monthly average
bill

Water . . . 2.5 times the monthly
average bill

If the required deposit is greater than $500.00,
which is due upon initiation of services, customer may split the remainder of
deposit into monthly installments of $25.00. The remaining installments shall
be payable as part of the monthly utility bills rendered to the customer.
Failure to timely remit any monthly installment shall be grounds for
termination of the utility service for which the deposit is required. Customers
who have failed to timely pay installments due on a utility deposit shall not
be eligible to elect to pay any future utility deposits on an installment
basis.

b. Application. All
customers must complete a utility application for new or transfer of services,
provide state issued photo identification or driver’s license, and agree to a
personal identity/credit check at the applicant's expense.

c. Refund policy. Deposits
will be applied to account balances upon calculation of final bill. The city
retains the right to apply any refundable deposit against the customer's
account(s) when a balance exists and then to refund any credit balance
remaining.

d. Transfer ofService.
When a customer transfers to a new location, utility service can be provided to
both locations simultaneously for seven (7) days without posting an additional
deposit.

(3) Non-residential
deposits.

a. Amount.
For non-residential customers, a utility deposit equal to two and one-half
(2.5) times an estimated monthly average is required for all locations.

b. Installment
payments. If any utility deposit required by this Code exceeds the sum
of one thousand dollars ($1,000.00), the customer may elect to pay the deposit
in not more than three (3) monthly installments, each equal to one-third (1/3)
of the total amount of the deposit. The first installment shall be due at the
time service is initiated, and the two (2) remaining installments shall be
payable as part of the first two (2) monthly utility bills rendered to the
customer. Failure to remit timely any monthly installment shall be grounds for
termination of the utility service for which the deposit is required. Customers
who have failed to timely pay installments due on a utility deposit shall not
be eligible to elect to pay any future utility deposits on an installment
basis.

c. Re-evaluation of
deposits. At any time after six (6) months' service the city may
re-evaluate the monthly bill and adjust the deposit up or down depending on
billing history.

d. Transfers.
When a commercial customer transfers from one location to another, a utility
deposit equal to two and one-half (2 1/2) times an estimated monthly average of
the new location will be required.

e. Multiple
locations. When a customer transfers to a new location, utility
service can be provided to both locations simultaneously for fifteen (15) days
without posting an additional deposit.

f. Application of
deposits. Deposits will be applied to account balances upon
calculation of final bill. Any installment not paid when due shall bear
interest at the rate of eighteen (18) percent per annum until paid in full. The
city retains the right to apply any refundable deposit against the customer's
account(s) when a balance exists and then to refund any credit balance
remaining.

(4) Poor
payment policy. Customers with a history of poor payment will be
required to pay a deposit equal to their classification (residential, rental,
non-residential) times the average monthly bill based on the most current twelve-month
history. Poor pay is defined as customer who has had either a NSF check or a
disconnect for non-pay during the last consecutive twelve-month period.

(5) Future
policy changes. The city manager and finance director are authorized,
by joint action, to establish such further policies and procedures to implement
this section as they may deem necessary from time to time, which policies and
procedures shall be presented to the city commission for its approval prior to
the implementation thereof.

(6) Name
change on deposit. A deposit can only be transferred to a different
customer in the event of death or divorce or when a business has purchased all
assets and the legal documents specifically state that the utility deposits are
part of the deal to the new owners. Legal documents must be provided to
substantiate qualification for transfer under this subsection.

(7) Interest
on deposits. All utility deposits held by the City of Leesburg,
placed by customers of any utility service provided by the city, shall earn
interest and the customers shall receive a credit for the interest so earned,
in accordance with the following criteria:

a. Deposits will earn
interest from the date of posting forward, to the date of final disbursement.

b. Deposits shall earn
interest at a rate adjustable monthly and equal to the rate promulgated by the
Florida State Board of Administration for the month which is two (2) months
prior to the month for which the rate is being computed. For example, the
interest rate on deposits in the month of May will be the rate set by the state
board of administration for the month of March.

c. Interest will be
compounded monthly and credited to the customer's account annually on September
30. For accounts that are terminated prior to September 30, interest will be
credited as of the date of termination on a daily, prorated basis.

d. At the time a
utility account is terminated, the deposit and any interest earned thereon will
be applied to the customer's final bill to the extent necessary to pay that
bill. Any amount of the deposit plus earned interest then remaining shall be
refunded to the customer.

e. Only cash deposits
shall earn interest. Any deposits held in the form of a bond or letter of
credit shall not earn interest or receive any credit for interest.

f. No customer shall be
eligible for the interest credit unless and until the customer has furnished
the city with the customer's Social Security number, or a Federal Taxpayer
Identification Number.

Section 22-263, of Chapter 22 of the Code of
Ordinances of the City of Leesburg, Florida, is hereby amended in its entirety
to read as follows:

Sec.
22-263. Nonpayment of bill, reinstating fee.

The
following policies and procedures shall be followed with regard to nonpayment
of utility bills:

(1) Approximately four (4) days
after meter-reading the customer shall be mailed a bill giving him twenty (20)
days to pay after which time a penalty attaches.

(2) Approximately twenty-five (25)
days after meter-reading date, a disconnect notice shall be sent warning of
disconnection as of a preset date appearing on the notice. The preset date may
be within ten (10) days from sent date, depending on weekends and work
schedule.

(3) On or immediately after the preset
date, service is terminated and a notice is left at the premises advising the
customer as to how service may be restored. Service shall not be reinstated
until delinquent and reconnection charges are paid. Service may, however, be
reinstated at the direction of the finance director in instances where payment
is guaranteed by a social service agency.

(4) The disconnect notice shall
contain a request to contact customer service if there are questions on the
accuracy, validity or correctness of the bill. If customer service cannot
resolve these questions, the customer shall be referred to the finance director
and disconnect shall be suspended until the issues are clarified. Customer
service shall notify the collections manager of the disputed bill in writing
immediately. In the absence of the finance director the collections manager has
the authority to suspend a disconnect in the event of a disputed bill.

(5) No disconnect shall result if
the past due amount is a penalty amount and not a current bill unless the
penalty is over a month old and is unchallenged.

(6) No disconnect shall result if
the past due amount is less than twenty-five dollars ($25.00) unless it is a
recurring amount. The finance director may increase this amount to a maximum of
fifty dollars ($50.00) where disconnect volume is excessive for manpower
available or the billing period is characterized by unusually high bills due to
rates or weather and where relief is apparent.

(7) The finance director may delay
any disconnect to the subsequent Friday where extenuating circumstances, such
as incidence of paydays, warrant such action and collection appears secure.

(8) A reconnect fee per utility is
required in accordance with the utility service fee schedule. If reconnection
is requested after 4:00 p.m., the charge may be greater if so indicated in the
fee schedule.

SECTION
2.

All
ordinances or parts of ordinances which are in conflict with this ordinance are
hereby repealed, to the extent necessary to alleviate the conflict, but shall continue
in effect insofar as they are not in conflict herewith, unless repeal of the
conflicting portion destroys the overall intent and effect of any of the
conflicting ordinances, in which case those ordinances so effected shall be
hereby repealed in their entirety.

SECTION 3.

If
any portion of this ordinance is declared invalid or unenforceable, and to the
extent it is possible to do so without destroying the overall intent and effect
of this ordinance, the portion deemed invalid or unenforceable shall be severed
herefrom and the remainder of this ordinance shall continue in full force and
effect as if it were enacted without including the portion found to be invalid
or unenforceable.

SECTION 4.

This ordinance shall become effective upon passage.

PASSED AND ADOPTED at
the regular meeting of the City Commission of the City of Leesburg, Florida,
held on the 27th day of April, 2009.